Land Securities is to sell its £240m Whitefriars Quarter shopping centre in Canterbury as part of an accelerated property sales programme in the wake of its conversion to a REIT.
The UK’s largest REIT, which on Wednesday reported a robust set of annual results in line with forecasts, has appointed Cushman & Wakefield to sell the 600,000 sq ft open air centre, which comprises the redeveloped Clocktower scheme, Whitefriars which was completed in 2005, and the recently refurbished Marlowe Arcade.
The proceeds of the sale, which will not incur Capital Gains Tax now that LandSecs is a REIT, will be used to finance the £1.1bn development pipeline.
Chief executive Francis Salway said LandSecs had sold £500m of property in the first three months of this year and was in the process of selling a further £600m.
The results for the year to 31 March showed a 14% increase in net asset value to 2181p a share and a 0.2% increase in revenue profits to £392.2m. ‘We believe the market will be comforted by these figures, rather than excited,’ said Lehman Brothers analyst Mike Prew.
The tone of Salway’s statement was one of cautious optimism, as he reinforced the general view of a slowing UK market. He pointed to a widening of the yield gap in the retail warehouse sector.
As a result LandSecs’s shares plunged 4% to 1935p today and dragged down British Land’s by 3%.